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In 2016, Susan Cassidy, VP of sales and marketing for the packaged foods division at CPG firm Bertram Gilman International, has to make a promotion decision. Should she choose the person she has been grooming for the position or another candidate recommended by central HR based on the firm’s promotions algorithm?

Diversity has the potential to either disrupt group functioning or, conversely, be the source of collective creativity and insight. These two divergent perspectives pose a paradox that has held the attention of scholars for many years. In response, researchers have marshaled evidence to specify the conditions under which diversity leads to more positive outcomes and explain why it does so under these conditions. After describing these foundational perspectives and more recent work that addresses this paradox, we outline several promising directions for research in this domain. We encourage researchers to develop integrative theoretical explanations, use new technologies to gain insight into group processes, study diversity in the context of virtual interaction, and take advantage of opportunities for cross-disciplinary research.